Why Will China Establish a Government-Sponsored Response Mechanism in Countervailing Games?

Abstract

China's economic development has caught the world's attention since its opening up to the outside world in 1978. The value of China's foreign trade exceeded US$2.56 trillion and its exports over US$1.42 trillion in 2008, and thereby China has become the world's third largest trading country. 1 At the sarne time, Chinese authorities have implemented a series of industrial policies and special plans to promote the optimization of industrial structure and to speed up the transformation of foreign trade development modes. Clearly, the Chinese government's application of taxation and fiscal support tools under the aforesaid policy and its special plans have a significant effect on the development of its industries. But along with the increase in China's export trade, the trade frictions between China and other countries (inter alia, the United States, the European Union (EU) and Canada) have become more intense. Since antidumping, 3 the technical barriers and the Section 337 investigations under the Tariff Act of 1930 of the United States, 4 Chinese enterprises have also faced numerous countervailing duty (CVD) investigations by these countries in recent years. 5